Currency Markets Sleepy In The Early Morning

Asian currencies are trading on a mixed note with respect to the dollar. No major economic data  is to be released today. Housing data from the US markets in the US session and are expected to improve, and if they do could support the markets in the North American session. The US Dollar index had a subdued session yesterday as compared to the last few days and is currently trading at 84.93. Euro and Pound are trading at 1.2803 and 1.6086 respectively. This morning has seen little action as the US dollar remains flat. Other currencies are moving between small gains and losses. Janet Yellen’s speech later today might cause some excitement, although after comments earlier this week, she is expected to hold on course. Yellen’s reported remarks were roughly in line with the forecasts presented by Fed policy makers at their last meeting in September. 

The US Dollar Index (DX) traded on a negative note and declined around 0.2 percent yesterday on the back of statement from FOMC member Kocherlakota stating that central bank need to consider with delaying of its final round of QE tapering. However, weak market sentiments in early part of the trade which led to rise in demand for the low yielding currency coupled with favorable economic data from the country cushioned sharp negative movement in the DX. The currency touched an intra-day low of 84.84 and closed at 85.04 on Thursday. 

US Unemployment Claims declined by 23,000 to 264,000 for the week ending on 11th October 2014 as against a rise of 287,000 in prior week. Industrial Production grew by 1 percent in September from fall of 0.2 percent in August. Capacity Utilization Rate was at 79.3 percent in last month with respect to 78.7 percent in August. Philly Fed Manufacturing Index plunged by 1.8 points to 20.7-mark in October when compared to 22.5-level in September. NAHB Housing Market Index was at 54-level in current month as compared to 59-mark in September.  

Thursday, the euro traded on a negative note and declined around 0.2 percent on the back of unfavorable economic data from the region. Further, weak market sentiments in early part of the trade continued with downside movement in the currency. However, weakness in the DX cushioned sharp negative movement in the currency. The euro touched an intra-day low of 1.2704 and closed at 1.2807. Italian Trade Balance was at a surplus of 2.06 billion Euros in August as against an earlier surplus of 6.92 billion Euros a month ago. Final Consumer Price Index (CPI) remained unchanged at 0.3 percent in September. Final Core CPI grew by 0.8 percent in September from 0.7 percent in August. Euro Zone Trade Balance was at a surplus of 15.8 billion Euros in August with respect to 12.7 billion Euros in prior month. 

The Great British pound is flat this morning at 1.6087 after climbing most of the previous week. The Sterling Pound traded on a positive note and gained around 0.4percent in yesterday’s trade. The currency surged on the back of weakness in the DX. However, weak market sentiments in early part of the trade capped positive movement in the Sterling Pound. The currency touched an intra-day high of 1.6096 and closed at 1.6087 on Thursday. The Japanese yen is trading at 106.35 against the US dollar against the euro the JPY is holding at 136.17. There hasn’t been much market action this morning due to a lack of data.